AMC - ITUB Stock: A Story of Reddit Warren Buffett and Currency Manipulation Allegations
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You’ve got to hand it to r/WallStreetBets: They’ve gotten very robust in their stock selection process as compared to the GameStop (NYSE:GME) era. The message board, which has grown significantly in the first half of the year, is picking mortgage REITs and private prisons as some of the latest meme stocks. It should not be a surprise then that the retail investor group is looking to follow whales to new frontiers, like they are doing today with Itaú Unibanco Holdings (NYSE:ITUB) stock.
Warren Buffett’s Berkshire Hathaway (NYSE:BRK-A, NYSE:BRK-B) recently invested $500 million in Brazilian Nubank, a financial servicer which deals heavily in digital currency.
The company is taking it upon itself to expand internationally and attract new clientele, which it is obviously succeeding in thanks to the Buffett investment.
Reddit Investors Embrace ITUB Stock
It’s through this lens of whales flocking south, to Brazilian banks which are embracing digital currency, that r/WallStreetBets investors see promise in ITUB stock. One user cites the news in a deep-dive post as a reason for investing in the increasingly popular market. It also doesn’t hurt at all that short interest is high on ITUB. With a short volume of 23%, Reddit would take interest in ITUB even if it didn’t have the digital currency applications and institutional bullishness that it has.
From this deep-dive and other bullish ITUB posts, discussion of the play is increasing a ton today. Mentions of the ticker are up over 6,500% in the last 24 hours.
And even through some pretty unfortunate news for ITUB, investors are piling in. Brazilian exporters are demanding nearly $4 billion from Itaú Unibanco and a handful of other banks specifically for its digital banking. The exporters are claiming that Itaú and these other banks are using crypto to manipulate foreign exchange rates unfairly. Regardless, ITUB stock has seen nearly 40 million shares trade hands today, against its 36 million trading average. The stock is up 2.7% today as well, with values lifting themselves up to $6.63.
On the date of publication, Brenden Rearick did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
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